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Use of Blockchain to record asset-backed securities

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A Fintech startup that collaborates with IBM uses blockchain technology to prevent double counting of collateral activities in forming asset-backed securities (ABS) portfolios. [19659001] Global Debt Registry has developed a private blockchain created to ensure the integrity of credit resources and protect resources committed on the network from errors or false representations in the future. The company has been working in the program last year. IBM's Digital Mentorship and subsequently became a member of IBM's Entrepreneur Program to help scale the company.

Solar Residential is one of the hottest asset-backed asset classes. & Nbsp; Photographer: David Paul Morris / Bloomberg

In his announcement the company stated that "In 2008, double-pledge loans, or borrowed assets that had already been committed, but due to trac methods Inadequate reporting and verification contributed to the collapse of some of the largest and most iconic financial institutions in the United States. the additions … "

The company's CEO, Charlie Moore, has downsized the press's suggestion that dual-title loans were behind the collapse of major banks. inefficiency and inadequacy of technology in dealing with an ABS market of $ 300 to $ 400 billion, not including mortgage-backed securities, paper spreadsheets and Excel.

In fact, later Moore suggested that perhaps more important than the risk of double-counted collateral, as initially suggested by the company, the greatest risk could be linked to the closing of over-collateralised loans.

Companies often have more loans promised than the 39, current credit line, said Moore

the company claims that blockchain technology will provide clear persistent documents

"Blockchain is faster, cheaper and more efficient iente ", said Moore. This asset class "has not seen much process innovation", he added. & Nbsp; "It's the same as 20 or 30 years ago when it comes to financing the bids and the way the securitization transactions are put together – it's a slow, manual process with a group of silent entities that manage a visualization of the information on loans without registration system [central].

The less than 10 Wall Street investment banks that managed almost all ABS offers spend a lot of time and money, with custodians, agents and lawyers to manage those loans The blockchain has come a long way in the last few years, providing a solution to data integrity, record integrity and the challenges of digital assets that industry has, he added.

"We have worked with large investment banks that are suppliers of the underlying capital. They provide warehouse services in the market space or self-loan space and participate in the underwriting phase. Then they distribute these bonds on the market; they have a lot of control over basic data around collateral positions. "

In general, loan information is sent to the various parts in spreadsheets or CSV files without everyone being looking at the same data at the same time, added – records are often not as up-to-date as they should be. fined on issues such as the misrepresentation of information on borrowers and loans, he said

"Part of the problem is that they would not necessarily have that transparency in the data from the source … having more certainty about the borrower and the data on loans reduce many risks. "

" Rating agencies assume that the data provided are accurate, there is no guarantee that loan information is around the base and the servicer's performance is accurate, because there is a lack of single registration system. "

Blockchain's performance is not a problem with loans," Moore said.

Asset-backed securities are not a data-intensive market, Moore said. concept (POC) in the capital markets have been around compensation and liquidation, which are intense and targeted at high-performance and high-performance markets.

ABS markets are not.

update on a monthly in spreadsheets, "said Moores. "They are very, very data-light with transactions that are measured in weeks or months instead of seconds.The final state is that the loan is native on blockchain and transactions can almost in real time."

The global debt register is developing a series of protocols on how industry can work with this infrastructure, how participants should record their data around a data standard for & nbsp; interoperability.

The company is now live with the first phase of collateral loan -750.0000 to which loans are committed, Moore said.

"Banks can start using it as a registration system when registering privileges with the DTCC.This is where we are starting and we will focus on that for next year, extending to the more complex data service in terms of data. "

ABS grows at double-digit rates, said Moore. & Nbsp; Solar residential is the most active.

"The market has moved from solar panel leasing to the homeowner who is actually underwriting a loan to provide that equipment, & nbsp; and that equipment is part of the warranty that is committed. solar supplier will have a warehouse line from a large bank and once accumulated sufficient volume will package it and sell it to investors. "

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A startup Fintech working with IBM uses blockchain technology to avoid double counting of collateral assets in establishing portfolios of asset-backed securities (ABS)

The Global Debt Registry has developed a private blockchain created to ensure the integrity of credit activities and to protect the resources committed on the network from errors or false performances in The company worked last year in IBM's Digital Mentorship program and later became a member of the business program IBM organizations to contribute to the scalability of the company.

Solar residential is one of the hottest categories in asset-backed securities Photographer: David Paul Morris / Bloomberg

In his announcement the company stated that "In 2008, double-pledge loans, or lending activities that had already been promised, but because of inadequate monitoring and verification methods, they contributed to the collapse of some of the largest and most iconic financial institutions in the United States … "

The managing director of the company, Charlie Moore, has downsized the print ad's suggestion that dual-loan loans were behind the collapse of big banks. Instead, he emphasized the inefficiency and inadequacy of technology in dealing with an ABS market of $ 300 to $ 400 billion, not counting mortgage-backed securities, with paper spreadsheets and Excel.

In fact, Moore later suggested that perhaps more important than the risk of double-counted collateral, as initially suggested by the company, the greatest risk would be to bind the capital with over-collateralised loans.

Companies often have more promised loans than the current credit line, Moore said.

the company claims that blockchain technology will provide clear persistent documents.

"Blockchain is faster, cheaper and more efficient," said Moore. This asset class "has not seen much process innovation", he added. "It's the same as 20 or 30 years ago when it comes to financing the bids and the way the securitization transactions are put together – it's a slow, manual process with a group of silent entities that manage a visualization of the information on loans without registration system [central].

The less than 10 Wall Street investment banks that managed almost all ABS offers spend a lot of time and money, with custodians, agents and lawyers to manage those loans The blockchain has come a long way in the last few years, providing a solution to data integrity, record integrity and the challenges of digital assets that industry has, he added.

"We have worked with large investment banks that are suppliers of the underlying capital. They provide warehouse services in the market space or self-loan space and participate in the underwriting phase. Then they distribute these bonds on the market; they have a lot of control over basic data around collateral positions. "

In general, loan information is sent to the various parts in spreadsheets or CSV files without everyone being looking at the same data at the same time, added – records are often not as up-to-date as they should be. fined on issues such as the misrepresentation of information on borrowers and loans, he said

"Part of the problem is that they would not necessarily have that transparency in the data from the source … having more certainty about the borrower and the data on loans reduce many risks. "

" Rating agencies assume that the data provided are accurate, there is no guarantee that loan information is around the base and the servicer's performance is accurate, because there is a lack of single registration system. "

Blockchain's performance is not a problem with loans, Moore said.

Asset-backed securities are not a data-intensive market," said Moore. POC) in the capital markets have been around compensation and liquidation, which are intense and targeted at high-performance and high-performance markets.

ABS markets are not.

monthly update in sheets calculation, "said Moores. "They are very, very data-light with transactions that are measured in weeks or months instead of seconds.The final state is that the loan is native on blockchain and transactions can almost in real time."

The global debt register is developing a series of protocols on how industry can work with this infrastructure, how participants should record their data around a data standard for interoperability.

The company is now live with the first phase of collateral loan -750.0000 and to which the loans are committed, said Moore.

"Banks can start using it as a registration system when they register privileges with the DTCC, this is where we are starting and we will focus on that for the next year or so and we will extend to the service of data that is more complex in terms of data fields. "

ABS is growing at double-digit rates, said Moore. Solar residential is the most active.

"The market has moved from solar panel leasing to the homeowner who is actually underwriting a loan to provide that equipment, and that equipment is part of the collateral that is engaged. a stock line from a large bank and, once accumulated sufficient volume, will package it and sell it to investors. "

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